NETHERLANDS - The combined returns of Dutch pensions funds considerably improved during the second quarter but still struggled to shift into positive territory, the regulator De Nederlandsche Bank has confirmed.

The schemes collectively produced a negative return of -0.72% on investments, after generating negative returns of -4.08% in the first quarter, DNB said in its latest statistics publication.

The yields generated were considerable different compared with the first quarter, as equities saw a negative return of -0.93% against the return of -14.4% in the first three months.

Alternatives' returns continued to contrast the asset class by delivering positive performance of 6.13% and 16.64% during the second and first quarter respectively.

Property and fixed income still showed a negative yield of -2.66% and  -1.64% respectively during the second quarter, after returning -1.10% and -0.06% respectively in the first three months, DNB said.

At the same time, the combined assets of Dutch schemes decreased by €9bn to almost €751bn, compared with €793bn at year-end, according to the supervisor.

The sum of equity investments rose by €13bn to €375bn in the second quarter, while the fixed income allocation decreased by €2bn to €252bn.

The combined loans and liquid assets also dropped by €9bn to €77bn, DNB added, while the value of financial derivatives decreased by €9bn to €16bn - returning the value of instruments to almost match those seen at the end of 2007.

During the second quarter, the average cover ratio of all the schemes dropped to 136%, and eight pensions funds fell short of a funding ratio of 105%.

However, no less than 225 schemes had a cover ratio of between 105% and 130%, which is an increase of 29 compared with the end of the first quarter, DNB reported.

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